Egypt plans to build a new oil refinery, its largest, and three new liquefied natural gas (LNG) production lines, Petroleum Minister Sameh Fahmy announced recently.

Egypt plans to build a new oil refinery, its largest, and three new liquefied natural gas (LNG) production lines, Petroleum Minister Sameh Fahmy announced recently. Work is underway on a feasibility study into the US $5 billion refinery and details will be announced soon to prospective investors, he said. The refinery, Egypt’s tenth, will be on the northern Mediterranean coast, Fahmy did not state its capacity but said it will be bigger than the current largest refinery, the 146,300 barrels per day Al Nast plant at Suez. Egypt is also talking to ENI, SpA, and BG Group about building three new production lines, called trains, at two natural gas liquefication plants they operate on the northern coast. Egypt’s gas reserves have doubled to 67 trillion cubic feet in the past five years, and it is Africa’s second largest LNG producer after Algeria. The country, which only started exporting LNG in January this year, from a Spain-based Union Fenosa Gas-operated plant, aims to be the world’s sixth largest exporter of LNG by 2007. Geographically, Egypt is strategically placed to serve the nearby rapidly growing European market by tankers, and the Suez Canal gives it quick access to India. Egypt gains in another way too from the current energy price spike: soaring oil prices have forced more shipping to use the canal to avoid more energy-expensive routes such as the Cape of Good Hope, which has boosted government income from the Red Sea route to $3 billion this year.